Rural Development

Lesson

Part 1 — rural credit and agricultural marketing: how farmers borrow and how they sell.

In this lesson you will

Explain what rural development means and which areas need attention
Explain why rural households need credit and compare its institutional and non-institutional sources
Evaluate self-help groups and the problems of rural banking
Explain the problems of agricultural marketing and the measures taken to improve it

Part 1 at a glance

Concept

What is rural development?

Rural development is action to develop the areas and people that lag behind in the village economy.

Table of areas needing attention for rural development: human capital, land reforms, credit and marketing, and productive activities and research, with why each matters
Area needing attention	Why it matters
Human capital: literacy, skills, health	Healthy, skilled people earn more
Land reforms	Secure land gives a reason to invest
Credit and marketing	Fair loans and fair prices raise farm income
Productive activities and research	New crops, methods and non-farm jobs

Diagram

Why farmers borrow: the gap between spending and earning

Farming has a long gestation period: spending comes months before income.